Debt reduction is, said FELI chief operating officer Roberto Roco, on of the "strategic objectives" of the company for the current fiscal year – a target it’s well on the road to achieve.
According to the company report, during the fiscal year ended September 2003, debt was reduced by P585 million, and by December 2003 – the first quarter of the current fiscal year – bank debts were further reduced by P354 million, leaving a balance of just P279 million which FELI is confident it can clear from the red by September this year through debt-for-assets swaps.
Added Roco: "With debts finally settled, the company’s senior management team can focus fully on its operations. From henceforth the renewed fiscal prudence we will practice will ensure that we secure new debt only for the development of projects that are highly marketable."
Other interesting points outlined by Roco in his bullish report to shareholders was the need to develop sources of recurring revenues which will provide FELI with recurring income even when there is a downturn in the economy, and the importance of identifying special niche markets and catering to them with special projects.
These include housing projects aimed at the low and middle income markets, which is a trend that most of the leading real estate companies are following as a profitable way forward.
Among such projects is the Sun Plaza, a high rise tower that has been reconverted from the original office building to a residential building. It offers affordable condominium units ranging from studio to one-bedroom.
Strategically located near the MRT Shaw Station, the Shangri-La Plaza, SM Megamall and Starmall, Sun Plaza is already 70 percent completed and is projected to be launched in the third quarter of this year.
Stockholders also received good news on the Cathedral Heights project, where a new investor has come in and settled in full FELI’s landowners’ loan with a bank. The second phase will be a 16-story twin tower which will be primarily marketed to Pag-IBIG members, with units ranging from 20-50 sqm.
Another project now moving into phase II is Mountain Meadows in Cagayan de Oro where FELI has entered into a co-development contract with Sta. Lucia. Work will resume in May for the first 18 hectares.
Other development projects aimed at the socialized, middle and upper markets on the road to completion – or the subject of negotiations with interested parties – include Tierra Vista IV and Sun Flower in Lipa, Richgate Phase 3 in Baguio, Festival Villas in Iloilo and Canyon Woods Phase IV.
FELI has entered into a joint venture with TGCI, the developer of Canyon Woods, for the development of 100 hectares of its co-owned property in Laurel, Batangas as phase IV of the Canyon Woods project that thus far has received a favorable market response.
Also slated for full completion by May 2004 is the Ecocentrum Business Park – with its two anchors of Splash Island on the South side and the Business Park on the North side. Furthermore, the completion of the Business Park will improve access to and from the Southwoods Interchange for the surrounding communities.
Substantial revenues are also expected to be generated from FELI’s Nasugbu Harbor town project in Batangas – an integral tourism and residential development – with Phase I spread over 1,600 hectares and involving an investment of P300 million.
"We are confident that the Nasugbu Harbor project will be widely received by the market," said Roco. "We expect it to be a large revenue earner and secure the long term profitability and growth of the company."